CoreWeave (NASDAQ: CRWV) shares fell more than 9% on July 29, 2026. The sell-off followed a surge in the cost to insure the company's debt against default.
Credit default swaps (CDS) jumped to 855 basis points. Market models now imply a 50% probability of default. This risk assessment covers a five-year outlook.
Credit markets are reacting to the AI cloud provider's aggressive debt-fueled infrastructure spending. The company currently holds a junk credit rating. CoreWeave also reports negative free cash flow.
The stock has declined 36% over the past month. This trend reflects a broader market repricing of highly leveraged AI infrastructure firms.